Earnings Miss: J&J Snack Foods Corp. Missed EPS By 51% And Analysts Are Revising Their Forecasts

As you might know, J&J Snack Foods Corp. (NASDAQ:JJSF) last week released its latest first-quarter, and things did not turn out so great for shareholders. Results showed a clear earnings miss, with US$348m revenue coming in 4.0% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.37 missed the mark badly, arriving some 51% below what was expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for J&J Snack Foods

Taking into account the latest results, J&J Snack Foods' four analysts currently expect revenues in 2024 to be US$1.58b, approximately in line with the last 12 months. Statutory earnings per share are predicted to step up 18% to US$4.84. Before this earnings report, the analysts had been forecasting revenues of US$1.60b and earnings per share (EPS) of US$5.52 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$186, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on J&J Snack Foods, with the most bullish analyst valuing it at US$195 and the most bearish at US$175 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting J&J Snack Foods is an easy business to forecast or the the analysts are all using similar assumptions.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that J&J Snack Foods' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 1.8% growth on an annualised basis. This is compared to a historical growth rate of 7.1% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.5% per year. Factoring in the forecast slowdown in growth, it seems obvious that J&J Snack Foods is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that J&J Snack Foods' revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$186, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for J&J Snack Foods going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with J&J Snack Foods .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.